Accounting policy instruments used in the debt management of local government units in Poland

Abstract

Purpose: The main purpose of the study is to determine whether local government units use accounting policy instruments to manage a limited level of debt.Methodology/approach: The article analyzes the literature on the subject and legal acts. In the empirical part, a survey addressed to treasurers and chief accountants of local government units was used. The research methodology was based on non-parametric statistical tests. The relationship between the variables on the ordinal scale was checked by Spearman’s rank correlation test, and the statistical significance of differences between the distribution of the perceived intensity of debt management and the selected grouping variable was tested by the Mann-Whitney U test and the Kruskal-Wallis test. Findings: Statistical inference made it possible to conclude that, in the respondents’ opinion, local government units use accounting policy instruments to manage limited levels of debt. Moreover, the statistical tests allowed us to conclude that the perceived intensity of the use of accounting policy instruments in managing an acceptable level of debt is not a derivative of the degree of local government units in the territorial divi-sion of Poland. Research limitations/implications: The research may become the basis for further research to assess the accounting system in terms of reporting the level of indebtedness of public finance sector entities in Poland. Originality/value: The research provides a new look at the problem of the indebted-ness of local government units in the Polish literature.

Keywords

• budget accounting
• debt
• accounting policy
• accounting policy instruments
• debt ratio management